Finance category

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Cash-on-Cash Return Calculator

See what the cash you actually put into a rental deal is earning. Combine purchase price, down payment, closing costs, rehab, expenses, and the loan into one cash-on-cash return number.

Purchase price

Down payment

Closing costs

Upfront rehab or reserves

Monthly rent

Vacancy rate

Monthly operating expenses

Interest rate

Loan term

years

Cash-on-cash return

1.60%

Annual cash flow

$1,496

Monthly cash flow

$125

Cash invested

$93,750

Deal at a glance

Cash-on-cash return is modest — common in higher-priced markets where appreciation does more of the work.

Down payment

$81,250

Loan amount

$243,750

Monthly debt service

$1,663

Annual NOI

$21,450

Cash-on-cash return divides the first-year pre-tax cash flow after debt service by the actual cash invested. Cash invested in this estimate equals down payment plus closing costs plus upfront rehab or reserves.

Editorial noteMaintained by EveryCalc - Reviewed June 2026

EveryCalc calculators are designed for fast, practical estimates with transparent inputs and no required account. We use plain formulas, visible assumptions, and related tools so visitors can check the result from more than one angle.

Results are informational only. For financial, tax, legal, medical, construction, or other high-impact decisions, verify the output against primary sources or a qualified professional.

Learn more about our review process on the EveryCalc methodology page.

Calculation notes and example

Cash-on-cash formula used here

Cash-on-cash return equals annual pre-tax cash flow divided by total cash invested. Cash invested usually includes down payment, closing costs, upfront repairs, and reserves. Annual cash flow is income after vacancy, operating expenses, and debt service. Unlike cap rate, this metric includes leverage, so the same property can show very different cash-on-cash returns depending on loan terms.

Worked example

A rental requires $95,000 cash at closing and produces $450 per month after expenses and mortgage payments. Annual cash flow is $5,400, so cash-on-cash return is 5.7%. If the rate increases and debt service cuts cash flow to $150 per month, the return falls to 1.9%. That sensitivity is why this page belongs next to cap rate and rental property analysis, not in isolation.

Edge cases and practical tips

Include upfront rehab cash even if it is spent after closing.
High leverage can boost returns when things go well and erase cash flow when rates or vacancy rise.
Cash-on-cash ignores appreciation and tax effects, so use it as one screen, not the whole decision.

Useful companion tools: Rental Property Calculator, Cap Rate Calculator, ROI Calculator, and Loan-to-Value Calculator.

How to interpret the cash-on-cash return result

Best use

Use the result as a planning number for comparing payments, rates, returns, tax reserves, or cash-flow choices before you request a quote or make a commitment.

Cross-check

Compare the answer with the contract, lender estimate, tax form, brokerage statement, payroll record, or invoice that will control the real-world outcome.

Watch for

Do not rely on a single optimistic rate, return, or fee assumption. Money pages work best when you run low, base, and high cases and keep professional advice separate from the estimate.

This page belongs to the Finance calculator library, so the answer should be read in the context of the decision you are modeling rather than as a universal rule.

Before relying on this cash-on-cash return estimate

Most calculator mistakes come from the inputs, not the arithmetic. Use this short audit before you reuse the answer in a spreadsheet, quote, application, or important conversation.

Confirm source numbers

Match balances, rates, fees, taxes, income, and payment dates against the lender quote, payroll record, tax form, statement, invoice, or contract.

Separate cash flow from total cost

A lower monthly payment can still cost more over time if fees, interest, taxes, or a longer term are hidden in the structure.

Run conservative cases

Test at least one higher-cost or lower-return case before using the output for a purchase, refinance, investment, loan, or tax decision.

Rerun this page when the rate, price, term, fee, tax rule, income, expense, or expected holding period changes.

How to Use

Enter the purchase price along with the down payment percentage you plan to put down.
Add closing costs and any upfront rehab or reserves so total cash invested is accurate.
Enter monthly rent, vacancy assumption, and recurring monthly operating expenses.
Set the interest rate and loan term to estimate the monthly debt service.
Review cash-on-cash return alongside annual cash flow and monthly cash flow before comparing the deal with other investments.

Frequently Asked Questions

What is cash-on-cash return?

Cash-on-cash return is annual pre-tax cash flow divided by total cash invested. It tells you how the cash you actually put into the deal is performing in year one, including the effect of financing.

What is included in cash invested?

This calculator counts the down payment, closing costs, and any upfront rehab or reserves. Some investors also add holding costs incurred before the property is rent-ready.

How is this different from cap rate?

Cap rate ignores financing and measures property income performance. Cash-on-cash return measures the leveraged return on the actual cash you put in. The same property can show very different cash-on-cash returns at different down payment levels.

Does cash-on-cash include appreciation or principal paydown?

No. Cash-on-cash return tracks actual cash that hits your bank account after debt service. Appreciation, principal paydown, and tax benefits are real, but they show up in total return, not in cash-on-cash.

Why was my cash-on-cash return negative?

Negative cash-on-cash means operating expenses plus debt service exceed the income the property generates. Common causes are over-leveraged purchase, undersized rent assumption, or under-budgeted operating expenses.